women at hotel front desk

Blackstone and Starwood Acquire Extended Stay America

The Largest Hotel Sale Since the Pandemic Began

Blackstone Group (BX) and Starwood Capital Group are buying the hotel company Extended Stay America (STAY) for $6 billion. This is the largest sale in the hotel industry since the COVID-19 pandemic began.

Analysts expect that hotels’ revenue will not return to pre-pandemic levels for two to three years, but Extended Stay has outperformed the rest of the industry during the pandemic. Blackstone and Starwood have high hopes that the chain will continue to perform well in the near future.

Extended Stay Outperforms Hotel Industry Peers

Demand for leisure and business travel has tumbled during the pandemic. US hotel occupancy was about 65% just before the pandemic. In mid-April it fell to 22%. On average, it was about 44% during 2020. Extended Stay was able to maintain an occupancy rate of 74%.

Extended Stay is a hotel chain for guests booking for several weeks or longer. Its rooms are larger than a typical hotel room and most of them have kitchens. During the pandemic, healthcare workers and other essential workers needing to work away from home turned to Extended Stay.

Expectations for a Bright Future

Extended Stay owns 567 properties and it franchises an additional 82. About two thirds of its locations are in the top 25 US metro areas.

Blackstone and Starwood expect that as the economy begins to reopen, construction workers, contractors, consultants, and other professionals will embark on long-term business travel to these areas. If this is the case, Extended Stay’s occupancy and balance sheets will stay strong.

Things are changing daily within the financial world. Sign up for the SoFi Daily Newsletter to get the latest news updates in your inbox every weekday.

Sign up

Please understand that this information provided is general in nature and shouldn’t be construed as a recommendation or solicitation of any products offered by SoFi’s affiliates and subsidiaries. In addition, this information is by no means meant to provide investment or financial advice, nor is it intended to serve as the basis for any investment decision or recommendation to buy or sell any asset. Keep in mind that investing involves risk, and past performance of an asset never guarantees future results or returns. It’s important for investors to consider their specific financial needs, goals, and risk profile before making an investment decision.
The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. These links are provided for informational purposes and should not be viewed as an endorsement. No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this content.
Communication of SoFi Wealth LLC an SEC Registered Investment Advisor
SoFi isn’t recommending and is not affiliated with the brands or companies displayed. Brands displayed neither endorse or sponsor this article. Third party trademarks and service marks referenced are property of their respective owners.

All your finances.
All in one app.

SoFi QR code, Download now, scan this with your phone’s camera

All your finances.
All in one app.

App Store rating

SoFi iOS App, Download on the App Store SoFi Android App, Get it on Google Play

ABOUT SoFi SoFi helps people achieve financial independence to realize their ambitions. Our products for borrowing, saving, spending, investing, and protecting give our more than one million members fast access to tools to get their money right. SoFi membership comes with the key essentials for getting ahead, including career advisors and connection to a thriving community of like-minded, ambitious people. For more information, visit SoFi.com. Want an easy and convenient way to manage your financial life? Get the SoFi app. For iOS and Android.

TLS 1.2 Encrypted
Equal Housing Lender